Japan Joins China Export Ban
Japan has joined the US and its allies in banning the export of a number of semiconductor tools that are used in the production of advanced semiconductors, particularly EUV tools at 10nm – 14nm and lower nodes, and tools used in the etching of stacked memory products. This follows an agreement with the Netherlands to do the same earlier this month, which choked off all EUV and advanced DUV tool sales from ASML (ASML) to China. Japan had proposed the rules in March, at which point China had announced some restrictions on Japanese imports, although the Japanese bands are a bit less onerous than the US restrictions.
The Japanese companies most likely to be impacted would be Tokyo Electron (8035.JP), Advantest (6857.JP), Screen Holdings (7735.JP), Nikon (7731.JP), and Lasertec (6920.JP), all to varying degrees depending on product mix, with the Japanese government evaluating potential subsidies or other compensation based on each company’s exposure to the added restrictions. Based on published data, Tokyo Electron derived 22.5% of sales of semiconductor production equipment from China in fiscal 2023, down from 25.6% in 2022. Advantest does not break out China specifically but derived 90.6% of 2022 semiconductor & component test (9 months) sales from Asia, with semi test being 71.1% of total sales. Screen Holdings, for fiscal 2023 (March) generated 80.5% of sales from semiconductor production equipment, and while they do not break out sales by region, ‘overseas’ is 84.3% of SPE sales. Corporate reps have made little comment, other than saying they will evaluate the situation or China is only a small part of the company’s overall sales strategy.
The Japanese companies most likely to be impacted would be Tokyo Electron (8035.JP), Advantest (6857.JP), Screen Holdings (7735.JP), Nikon (7731.JP), and Lasertec (6920.JP), all to varying degrees depending on product mix, with the Japanese government evaluating potential subsidies or other compensation based on each company’s exposure to the added restrictions. Based on published data, Tokyo Electron derived 22.5% of sales of semiconductor production equipment from China in fiscal 2023, down from 25.6% in 2022. Advantest does not break out China specifically but derived 90.6% of 2022 semiconductor & component test (9 months) sales from Asia, with semi test being 71.1% of total sales. Screen Holdings, for fiscal 2023 (March) generated 80.5% of sales from semiconductor production equipment, and while they do not break out sales by region, ‘overseas’ is 84.3% of SPE sales. Corporate reps have made little comment, other than saying they will evaluate the situation or China is only a small part of the company’s overall sales strategy.
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